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Trusts

This category contains 161 posts

Equitable lien equality

As noted in Representation of Rawlinson & Hunter SA re Z Trusts at decision of the Royal Court of Jersey at [2] a trustee’s equitable lien is a “device of equity granted to trustees by the Court to give them rights of indemnity and priority over the interest of beneficiaries.”  The Royal Court in this case then … Continue reading

Costs bite when trustees fight

Trustees fall out, sometimes to the point where a working relationship is no longer possible. Applications to remove trustees are becoming an increasingly common occurrence. So, should trustees fight attempts to remove them? When is it appropriate to do so, and when not? And what are the potential consequences of misjudged opposition? The recent decision … Continue reading

When is it ok to ask for directions?

Two recent decisions regarding directions in the context of charitable trusts provide some useful guidance regarding the parameters of s 66 of the Trustee Act 1956.  In line with the title to this blog – the conclusion reached is that it is permissible to ask for directions if lost, but not in circumstances where you … Continue reading

Constructive Trusts and other Trust Remedies

The development of the constructive trust in New Zealand and the parameters of remedial and institutional constructive trusts (and constructive trusts on express trusts) is an important aspect of trust law.   Vicki Ammundsen is presenting a practical remedy driven webinar on 14 September 2018 at 1.30am that considers constructive and other trusts in family, relationship and commercial contexts. … Continue reading

Is debt forgiveness on account of a loan to a charity a gift that allows a tax credit?

In Roberts v CIR the question for the court is whether the forgiveness of debt a monetary gift for the purposes of s LD 3(1)(a) of the Income Tax Act 2007? Background The Oasis Charitable Trust (the Trust), a registered charitable trust, was settled by Mrs Roberts and her late husband on 14 October 2007 to facilitate the … Continue reading

Trustee shareholders

It is important when dealing with trustee owned shares to appreciate how these might be treated for tax purposes.  The following question from the CCH/TEO Q & A Service considers how and in specie distribution of share should be treated in the context of a distribution and a resettlement. Company shareholder continuity QUESTION: Trust B … Continue reading

Rectification of mistake

The Matter of the Representation of Virtue Trustees (Switzerland) AG and Anor re The C Trust (the Trust) heard in the Royal Court of Jersey relates to a trust where a beneficiary named in the deed was also appointed a protector (by a hand amendment when the deed was executed) where the terms of the deed … Continue reading

Hastings-Bass revisited

The “Rule” in Hastings-Bass (more properly the rule in Mettoy) invites a court to “wave the judicial magic wand” and void decisions made by trustees, together with the attendant consequences,  when trustees have made decisions with consequences from which they now with to resile.    The logic of “the “Rule” was to protect beneficiaries.  However, where … Continue reading

Trading Trusts

Transactions between GST-registered trusts and beneficiaries need careful scrutiny to ensure that GST obligations are not overlooked or obfuscated by the relationship between the trustee and the beneficiary. Although GST registration is in the name of the trust, the obligations fall to the trustees. For tax purposes a GST-registered trust and its beneficiaries are associated persons.  This means … Continue reading

US Sham trust decision

The judgment in Full-Circle Staffing, LLC, Watchman Investment Trust, Financial & Tax Services, Inc., Trustee, Tax Matters Partner, Et Al. v Commissioner of Internal Revenue (Full Circle) is a consolidated judgment of the United States Tax Court. The background facts are complicated but can be summarised as follows: Mr and Mrs Pudlo restructured their freight forwarding … Continue reading

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